Technology

Data Center Construction is on the Rise in Latin America

18 Jul 2023

In recent years, data centers have become more global, sparking a construction boom in Latin America.

In our digital world, data centers play a key role in the provision of cloud and data processing services. For a long time, this industry, which is expected to grow at a 4.7% CAGR in the 2023-2027 period according to Statista, was concentrated mainly in two hubs: the USA and Europe.

In recent years, however, a significant shift toward globalization has been taking place, sparking a data center construction boom in Latin America, as the region becomes an increasingly attractive market for tech companies. 

Global Decentralization

The data center industry’s ongoing decentralization is driven by several factors, such as the need to reduce latency and improve the end user’s experience. Latency is the time it takes data to go from a server to the user’s device, which can affect services that need quick, real-time communication.

Data Center Construction is on the Rise in Latin America

In our digital world, data centers play a key role in the provision of cloud and data processing services.

To address that challenge, cloud service providers have opted to build data centers in strategic locations closer to their users, far from the USA and Europe. For example, according to BNamericas, large corporations such as Alphabet, Amazon, and Microsoft have made investments to build data centers in countries such as Brazil, Mexico and Chile.

In this context, companies focusing on Importer of Record (IOR) services, like Aerodoc, play a crucial role in the globalization of data center infrastructure.

Aerodoc COO Dan Zonnenschein highlighted the company’s key role in that expansion by explaining that “since 2020, Aerodoc has been consistently expanding, supporting the distribution of data center equipment around the world, especially in Latin America and Asia.” According to Zonnenschein, Aerodoc’s Delivery Duty Paid (DDP) + IOR service has helped a number of data centers ship equipment to countries with complex importation processes, accelerating their implementation.

Benefits of Latin America’s Data Center Construction Boom

Data center construction in Latin America has had a series of significant benefits for both tech companies and end users, which go far beyond improvements in the quality and speed of cloud services.

Economic Boost and Job Creation

The construction and operation of data centers in Latin America has had a positive impact in the region’s economy. According to a BID Invest report titled Data Centers in Latin America: Social and Economic Impact, investments in data centers are expected to create more than 26,000 direct and indirect jobs by 2023. Those investments should boost economic growth and the development of related industries such as construction, energy, and telecommunications.

Improved Connectivity and Access to Digital Services

Latin America’s data center construction boom has also helped improve connectivity in the region by providing faster, reliable access to digital services. The newly-built data centers act as content distribution and interconnection hubs, reducing latency and improving connection quality for end users. This is also highly beneficial for companies that rely on fluid communications in real time, such as those that provide video streaming services, e-mail, or business apps. 

Data Center Construction is on the Rise in Latin America

Latin America’s data center construction boom is a clear sign of the tech industry’s march toward decentralization on a global scale.

Innovation and Technological Progress

Having regional data centers has fostered innovation and technological development in Latin America, as they provide an adequate environment for startup incubation and tech research projects. Furthermore, the availability of cloud services and access to high-quality infrastructure has made it easier to develop innovative apps and digital solutions in several industries, including healthcare, education, agriculture, and e-government.

Data Sovereignty and Regulatory Compliance

Latin America’s newly-built data centers have given the region’s companies and governments an opportunity to take control and assert sovereignty over their sensitive data. In the past, a large chunk of data storage and processing services operated in data centers located outside the region, raising security and regulatory compliance concerns. Local data centers help organizations comply with their countries’ data protection policies and regulations, securing their users’ and customers’ trust.

Sustainability and Renewables

The construction of data centers in Latin America has increased the focus on energy efficiency and the use of renewable energy. The region’s new data centers are implementing technologies and practices to increase energy efficiency in order to reduce consumption and their environmental footprint. Furthermore, companies are investing in renewable projects to power the new data centers, contributing to the transition to a more sustainable economy with less emissions.

Latin America’s data center construction boom is a clear sign of the tech industry’s march toward decentralization on a global scale, a trend that has accelerated in recent years. As a leading provider of data center equipment importation services, Aerodoc plays a key role in that process, shipping equipment to countries with complex import regimes.

As data center infrastructure expands throughout Latin America, tech companies now have the chance to provide faster, more efficient services, driving economic growth and digital transformation in the region.

To learn more about Aerodoc’s DDP + IOR service, contact our team.

 

Topics on this article: data centers | South America

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